i focus on economic growth and i think we've talked about it several different ways this morning. it cures a loft ills, maybe all the ills out there today and i think we got to get job creation, we got to get unemployment down. give people a sense of self-worth. it's sustainable. it is predictable. and i just think it's got to get on the table. >> you're talking about growth in the private sector, not in

the government. not talking about growth in the government, right? >> not to create more conflict between you two. >> there are two ways to -- two kinds of people in the world. >> that's why i'm on this side of the table, joe, with you. >> thinking about it. in washington right now, they -- i would say there are some people that are more interested in growth in the government than growth in the private sector. >> well, look, again, i'm not a politician, but i want to focus on good, economic growth. good business growth and how do we get back to the days that we enjoyed? >> bob, thank you so much for being here. we hope to see you again soon. >> thank you. i've had a great time. great visiting with you. >> does it for us today. now, it's time for "squawk on the street." ♪ know that theme music any night, say good-bye to liz you jack and the crew on "30 rock." i'm carl can teen nia, melissa lee, david faber, jim cramer.

chicago pmi on the way. facebook earns, by most accounts, were pretty impressive. mobile ad revenue, two times the prior quarters. analysts want to untag the stock, at least three down grades today as the company says expenses are going up. >> is the last day of january. only 12 times since 1950 has the s and p 500 gained more than 5% in the first month of the year. wait till you hear how those years generally turn out. >> ups misses the quarter despite good volume growth, both in and out of the united states. with that t & t deal dead, company's buy back plans got bigger. >> the reviews for the blackberry 10 is mostly good, but from analysts, mostly bad. why so many downgrades for r.i.m. one day after the its big launch? >> first up, shares of facebook down sharply in the premarket a number of analysts down grading the social network despite results that did beat the

street, including a 40% jump in mobile -- revenue. mobile advertising sales doubled from the prior quarter although that fell short some of the most optimistic analyst estimates. facebook says it plans to spend heavily to recruit talent. ceo mark zuckerberg explains his strategy last night on facebook's conference call. >> we made the decision to continue to grow our head count quickly in 2013, particularly in product development this will likely cause our expenses to grow a faster rate than we expect to grow our revenue this year, which means we respect operating to maximize our profits this year, we are do doing what we think will build the best service in long determine. >> jim, we said yesterday, the company, a la amazon is looking at the long haul. >> yes, i thought this was good. now, let me tell you why i think the stock's down. it ran tremendously, people who want to get off, they have good gapes. what i thought was important was if you look at a couple of stocks, amazon, if you look at netflix, if you look at sales force, they all have the same

approach. land grab. put as much money as possible. don't think about short term. this is what we want from great american companies. so i'm not against what they're doing. it may not be a reason to go buy the stock, 'cause people don't want to hear 50% increase in expenses, but if you want to whip, game, set, match, like zing gas you do what zuckerberg does. >> help fuss control the company, don't worry about anything like that that being said, investors today are disappointed with -- they are focused on that trajectory of desktop to mobile. they didn't get what they hoped for in this last quarter, expecting what we saw out of the quarter previous, because when you talk about dollars per day. they gave us an exit rate q 3 to q 4. didn't give it to us last night a bit less transparency, 306 million in mobile advertising revenues was lower than the sell side and lower than the buy side, more optimistic. those numbers coming down,

hence, stock price coming down, analysts down grading. >> it's a concept stock. now, i don't like concept stocks. i did last night. amazon versus apple. i think we are saying, cramer loves amazon. i'm actually showing how cheap apple could be. this is not a cheap stock. the market historically has a couple of stocks at any given time that overlooks bad. david's right. there was a lot to not like. with but at the same time, i think the growth guys will say, hey, give them a couple years and that's what tends to happen. >> the investers who look at valuation ant shorter term, maybe long, long term this is a great stock. maybe they are taking a page from jeff bezos, investing in the business long term. immediately, you see an 82% rise in operating expenses and know the company is going to be pouring more money in you knee will be pressure on valuation, you know it's going to be pressure on markets, you know pressure on markets overall. helps the caution on the name in today's session and yesterday, the afterhours session. no surprise the stock has pulled back. >> no, but remember, they are

trying to be bezos. >> he went through difficult years. with us a lot longer. he has been tested as a leader, as a visionary. clearly the market has confidence in bereeze zoe. >> they just did their android app for mobile. if you're annize tear, called out on the call, i understand why a lot of people say, look, this is a declining story, a spin story >> interesting at 20 no the so interesting at 30? an intel 20/30 thing? >> that's right it ran too much,

given the fact it didn't blow out the numbers. but price, everything in a price, this is a better story lower. >> citi to neutral, jeffrey's, citing the higher expenses in 2013, the common thread from the analysts cautious on the stock today. >> earnings are down. >> a great growth company but may not be growing fast enough to justify that multiple. >> you care about earnings, they weren't great. if you care. i put it like that we discovered time and time again, some people just don't care and they tend to be growth funds. and they have a lot of money and they can control the situation. >> there's one guy who really controls are the situation, that's mark zuckerberg. at the end of the day -- >> private company. >> i say that, i have gotten a

couple of twit. stop saying -- i will try. >> end of the year. how about the end of the millennium. >> we are all dead, okay? >> second day in a row, somebody said put that in your pipe and smoke it. said it yesterday. >> let's use that instead. >> at the end of my life. my friend david strasser said something interesting to me yesterday -- today. he said if amazon had gone down, if the stock had ticked down, analysts would have deserted it. here is an interesting question. how many analysts are playing the game of looking at what the stock's doing and -- >> i think a lot. yesterday, when we were following the afterhours action on facebook and the stock was going lower, the analysts initially came out with the note, initial take away notes, flash notices, looks like a largely strong number, looks like a good report, florida blah blah a -- blah blah blah, and today we come out with down grades and caution. interesting how the tone

changes. >> if the stock had been up, people would say this is great, they are spending for the future. because the stock's down, i got to get off t recommend it lower, i got to get off t people want to get off it, because they don't want to play the apple game, taking -- price target 1,000. >> right. >> and now, well, what do you say? >> less. >> less. >> a lot less. >> at the end of the day, less. >> put that in your pipe. the dow heads into the final trading day of the month, on track for its best january since 1989. but the road to 14,000 took a detour yesterday as the dow pulled back after the fed started economic activity had paused in recent months. this on top of a fourth quarter gdp report indicating contraction in the economy for the first time since 2009. the s & p 500 is up more than 5% so far this month. very, very strong month. >> what can you say? this is a great bull market. it is.

i mean, the averages went up big. transports led us, okay. could we go for a breather? it would make sense, but the fed is not stopping. it's not stopping the fed. >> s & p keeps putting out these historical numbers, a 5% gain in january and years like that, just going back to '50, 1950, 31% for the year, 27, 26, 31, 45. i mean, just -- does this year hold that potential. >> hear siegel this morning, i know there's controversy, even on this deck, about -- >> for the long term. >> he did call the top. >> he loved housing you and -- my god, i'm sorry. >> my dad's building, the society of towers.

>> since the last time we had the gapes, '07, 12-month forward pe is 15. back then, it was 9. we are not overpriced necessarily, given the run that we had. >> keeps rates down, competition from bonds, not so great. i still can't get over that they preserve thafd dividend low tax rate these are bond equivalents, a lot of stocks, especially when they boost the dividends. keep the balls in the air. that's what can happen. >> yeah. a lot of discussion yesterday as to why the fomc continues nobody that kind of mode as opposed to something else, which people speculated a lot b meantime, speaking of broad economy and markets, a pair of multinationals falling in the premarket, ups posting a earns of $1.32 that missed. revenues slightly exceeded. also issues guidance below estimates and dow chemical says the company saw significant

deterioration in market it is serves, especially china. earlier on "squawk," dow chemical outlined the challenges for the company. >> could dampen the economy again through our politics but i would tell you i key is good things out of china with their leadership stabilizing and emerging asia as a whole. 35% of dow's revenues are now in emerging geographies and where we are putting a lot of our investment and our money. >> how concerning, jim, two big mac crow bellwethers like those? >> i question dow's execution, performance chem kills for ppg were excellent, okay? now, there are a bunch of different codings and performances, performance chemicals that due pop the has that were bad. dow had the same ones. i question whether these two companies have done too many different things in a short period of time. this acquisition they made, i think -- i still think it's

hurting. i still think it is hurting. >> why? >> that is performance chemicals and i feel like if ppg is doing so well, if dow chemical has the lowest feed stock, why aren't they doing better? it's a great company. the net debt is stable. but you know what, i expected a blowout here and i didn't get it. i thought they could blow it out. they did not give us one. >> you pair that with ups, which was a miss. the outlook on 2013 was very cautious there as well. you start to think maybe the broader industrial economy is seeing bumps in the road. >> federal express is doing much better. i wonder whether the tnt acquisition -- >> was a distraction? >> distract ups management. acquisition failed, by the way. >> yes. and maybe shareholder's benefit at the end of the day, the end of the day. >> start counting it, maybe it's not just me. >> in terms of increase the share buy back. >> ups a great company.

i think them get it together. i don't want to sell at that time. lot of companies, ups and dell, point them out. not talking robust asia. how many companies like honeywell, like even the, like ppg, saying asia's back. again, i question execution of ups. >> all right. when we come back, research in motion's massive rally seems like a distant memory, stock taking a hit since yaepsd blackberry 10 launch. is the honeymoon now over for the r.i.m.? the home building sector has been hot but almost a decade since home builder went public. tripoint homes is ending that drought by debuting on wall street. the ceo will visit us at post 9. futures, a lot we haven't gotten to "squawk on the street," live from post 9, back in a minute.

shares of research in motion falling premarket trade after yesterday's 12% drop this all after the company unveiled its blackberry 10 lineup including two new smartphones but u.s. customers won't be able to get them till march and that is a month later than r.i.m.'s home country of canada. r.i.m., which is changing its corporate name to blackberry, has been downgraded by the likes of credit suisse and evercore partners. after how many delays to get the phone out finally, they have this big launch event, they have ads during the super bowl and by the way, not going to have the phone in the market until weeks after that? >> i'm looking at the phone to

call brian. >> here it is, by the way, they did bring -- >> i'm reading david pogue in the "new york times." i'm thinking a year ago, this had this out a year ago, stock would be at 30. may be too late. may be too late. >> too late? so it was a break moment for research in motion? >> i'm looking at the research says, very clearly, other than goldman, that it's too late. that it's just not enough and too late. >> is there a willingness on the part of consumers to change more quickly perhaps than we give them credit for? everything moves in such -- in a faster timeframe perhaps than it used to. i see people changing devices all the time. >> will verizon push it? a consumer product you think the corporations will keep it? what was the chatter? >> the idea is because you can separate your personal life from your work life on this given the new policies of bringing your own devices and enterprise unit might say, all right, that's nice. we can just take out the entire work part, if you leave, or add

it back in if you're being hirehood, but the question will be, is this an enterprise product or a consumer product? on the "today" show this morning trying to convince america it is a consumer product. >> in terms of user, the people who use it, it is a consumer product at this moment, they lost so much of the enterprise share. yesterday, we were you were at the event, so many people saying because of the security features, security features, yet they have lost the lion's share over time. security was not a reason to stick with research in motion. so what is it going to be now? what is the reason to go back? >> will corporations go back? >> i don't know. >> anyone switch? any consumers switch? i'm asking. >> i have no idea. >> what's your take? >> i think that the corporations, it's still bring your own device. they opened that door, you don't go back. you don't go back. >> the corporations went to the other devices as a result of their own consumers being their employees taking them there. i don't sense that -- >> would anyone here switch? >> no. >> no. >> no. >> no.

>> i don't think so. >> no, i'm not gonna -- >> i'm not either. [ overlapping speakers ] >> i want to try that bigger screen samsung. watch movies. >> you want to make phone calls. >> like the old days. >> the point does appear to be, i think credit suisse, somebody said, daunting challenge. fair? >> yes. >> the rest of the world has not stood still. >> the only reason, when the i phone came out, i switched the next day. i went over to verizon, said do you have it? it's not that, right? it's not a -- boom. omg. no omg. >> evolutionary. >> by the way, tomorrow is the big january jobs number. of course, that means another chance for you to nail the number. tweet us your predictions for january non-farm payrolls or handles at squawk street, #nail the number. the prize this month will make feel nice and cozy in time for valentine's day. it is a blanket, autographed by the "squawk on the street" gang. you will have one minute before the friday release to tweet your

predictions. best of luck. none of us have used the blanket. >> pristine. pristine. which may be a draw, may not be a draw. i don't know. >> hold it. >> make a sweet valentine's day gift, i'm sure, for someone. >> also the end of the month, cramer's got some ideas to help you speed past the finish line. hear about them next in his mad dash. later on, an exclusive with whirlpool ceo. stocks hit 52-week highs. the appliance giant maintained the upward momentum after the great year last year. futures modestly week here. a lot more "squawk on the street."

get the mad dash for your thursday with jim here, talking about priceline. some of these momentum plays under assault. >> morgan stanley is saying there's too much competition. priceline, intuitive surgical, amazon, these all trade together. be careful. one momentum chink, they all kind of trade down. >> all right. i'll keep an eye on that. >> yes. >> also the other one you are watching? >> dunkin' donuts. this is great. they are on tonight. i cannot wait. they reported great gross margins. terrific unit growth. i did not know this they only have 150 west of the mississippi. they are going to open dramatically in california. another one that people may not get but they love basketball in china. lebron james has become the

spokesperson, love him. moving aggressively in china. this is a story that people said, you know what, i want to be in it for the long haul because they think it is the next domino's. domino's pizza, one of the greatest performers is a franchise model stock. this is a franchise mold. carl, i think a great one. >> traffic, ticket price. >> all good. all going up. and remember, baskin-robbins has been underperforming. they own baskin-robbins, aggressively expanding in china. maybe ice cream sells there. >> yeah. well, if they can support as many stores out west as they do in boston, where it's like every few hundred feet. >> there's 10,000 duncan -- dunkin' donuts this is like florida, michigan and there's nothing on this side. we can open them -- we. i wish aid franchise. you can open them in this part of the country for -- not bad, for ages and ages and i can't wait to speak to them. they are good. >> i think some of the rules on

the franchisecies, you have to open a few. i mean, you can't just do one. >> yes. yes. >> you have to run ten. that would be a huge question. >> you know, people love coffee. now remember mcdonald's had $1 promotion, people felt that -- people were shorting dunkin', betting that would cut into the $2.72 similar size it hasn't. it's going to be good coffee. >> when we come back, the first home builder to go public in almost a decade. tripoint homes ringing the opening bell in a moment. we will bring you the company's first trade and a live interview with the ceo when "squawk on the street" continues. when i take a picture of this check, it goes straight to the bank. oh. oh look the lion is out! no mommy no!

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bob will retire when he's 153, which would be fine if bob were a vampire. but he's not.

♪ he's an architect with two kids and a mortgage. luckily, he found someone who gave him a fresh perspective on his portfolio. and with some planning and effort, hopefully bob can retire at a more appropriate age. it's not rocket science. it's just common sense. from td ameritrade. you're watching cnbc's "squawk on the street," live from the financial capital of the world, the day after the worst day for the s & p of the entire year, down six points, we continue to be in this single-digit phase, which can go on, too, for a very long time. some stretches go 20 sessions. >> look, i come back to those january -- that january forecast. i tend to not like those, if

only because who knows what's gonna happen. >> right. >> but the impeer cal evidence for january is so significant that you've got to -- i've got to somehow -- it can't be dismissed, leave it that way i can't be dismissed, that january is the signal for the year. >> after gdp, david, had some scratching their heads, why doesn't the quarterly data match with the monthly data? get chicago pmi in about 15 minutes and that's gonna feed a rollover the month, a fresh new set of data. >> it is being termed the best/worst gdp number we have seen. >> the "usa today," a dip in the economy, not so bad, which i thought was, okay, i guess they made that call. >> they made the call.

>> it shows again and again and again. >> in terms of tri pointe homes, might be a good day to go public. pulte coming in this morning with a beat. dr horton coming in with a beat. in terms of the environment for a housing ipo, this could be a very good day. already, they had to increase

the size of the offering they prize above the range, $17, putting the valuation of the company more than $500 million t is going to trade at the post right behind us, we will get the inside scoop on where this thing looks like it will open. >> california this is a california home builder, san francisco area. also southern. look, when you go to the website, they are selling them like hot cakes. >> single-family homes. >> what does that say? california home builder going public? >> my, how far we've come. >> pulte's down, jim. >> pulte is down, jim. >> thank you. thank you for that wet blanket. that wet electric blanket. >> a wet signed blanket. >> anything else you need me to tell you? >> whatever you want. >> speaking of housing, we are going to talk to fettig from whirlpool in the 11 this morning. pricing is getting better but volume is not matching at all what new homes are doing. >> surprising, low single

digits, the companies make a lot of money. they have got trade rulings that are their favorite. this is perceived as being the quint essential, build more homes, sell more whirlpool. >> upgrade cycle, not just new homes, upgrade cycle, a lot sold at the height and prior to the housing boom and those' ply yanses need to be replaced, dryers, washers, et cetera. >> that was one that, again, i wonder if the stock had opened down, whether someone might say i'm off of whirlpool. i do see analysts, again, taking cues from stocks. suddenly, everyone loves whirlpool. >> means they are no help to us, taking a cue from the stock. >> they are not. any verdict yet on viacom, david? >> not that bad. and we are going to talk more about it in the faber report. time warner cable perhaps not quite what people had been hoping for. both those calls taking place but we will give you a bit more color on both those earnings reports, one to, of course, distributes content and the other provides the content. viacom, if you had to pick, carl, probably the better of the

two, though not great either. >> having touched on under armor yet. 47 cents, beat buys a penny. revenue better? >> a lot of people thought a miss, a lot of people felt the weather wasn't right for under armor. people felt? a very competitive situation. don't forget, this is a maryland company t is uniquely associated with the ravens. >> ah. >> and my son has ten separate under armor sweatshirts i. he can change every single -- for ten straight days, he can wear a different one and cycle through again. maybe it's 14 at this point. >> a technology brand. they have -- >> technology? he believes that. he does. >> you listen to me. they have a technology that i lou -- allows to you blow off the sweat. >> otherwise the same as haines brand, didn't have that's expect of technology, they would just be selling cotton t-shirts. >> working for my 10-year-old. he is into the technology. >> yeah. your kid like apple or samsung?

>> apple. >> oh. okay. >> telling. >> that's all he knows though. he doesn't have a phone. he just has a -- >> doesn't? boy, you starve your kids. >> something. i know. >> use two cups with you? how does he text with you? i haven't talked to my kids in ages, but i text. how do you text? >> they are 20 whatever. i mean, come on. >> they are small. >> the next generation doesn't know how to talk but text. >> he has an itouch. >> don't know how to spell. >> but they have spell check. >> master card, fresh record high for master card. better-than-expected earnings. the new level and visa is getting pulled higher as well. >> people will short it. i have to tell you that there was a note came out the other day saying sell, sell, sell. that obviously was wrong. on the backs of the shorts this is going higher. >> buy facebook at $29 even? that's where you can get it now? >> if you are one of these growth guys that doesn't care, you're thrilled, you're buying. >> put it away for a couple of

years? >> that's what they're doing. look, i -- hard to justify. >> hard to justify. >> absolutely. 82% rise in expenses in the quarter and you're gonna spend more? >> i mean, i get it, too, they need to do that. >> i get it, too, do you want to be along for the ride as they do it? >> believe in the story, the power of the franchise and the brand and its ability to perpetuate itself on mobile device around the world? yeah, i guess you don't care about your entry point as much, you're looking back two years, the stocks are double. >> people looking for the next amazon. they think they have it. >> yeah. research in motion down 8 1/2% on top of the 12% decline in yesterday's session. let's check in with bob pisani here on the floor for what is moving this morning. hi, bob. >> the first home builder in ten years to go public, looking pretty good here. 19 a quarter right now, amer right tash. 13.7 million shares at $17. impressive. because remember, the price talk

was 11 million shares, pricing over 13. the price talk was 14 to 16. go in at 17, looking at 19275. people messaged me overnight, said the pricing came out, what the heck is going on here? whatty the move up in the builders? three reasons i can see. one, they are backed by starwood. a marquee name people know and understand. second, we are in the middle of a housing recovery. third they can bought a lot of land very cheap. that's gonna help a lot when they start building in california and also, i understand, as well as in arizona. i'm sure you guys will be talking to the ceo shortly. still 19.25 on that one. else where the biggest fear of traders overnight, one messaged me, death by slow growth. that's the big fear. so, remember, all the trade verse been set up for stomach crow economic disaster, maybe europe melting down, maybe some problem with the debt ceiling negotiations. maybe some other kind of macroevent. last night saying to me, wouldn't it be ironic or weird

if the big pest thing that happened hurricane the biggest fear of macromelt down never happened but instead what we got is boring old no growth? something nobody was really set up to deal with right now. that is not the dominant emotion. right now the jeep feeling is the bulls are still in charge. a lot of e-mails about siegel, jeremy siegel, 70% chance the dow will hit 15,000 this year. that was widely commented, to me at least, this morning. he sees a big increase in consumer spending. says the housing recovery is going to continue. home builders had good numbers but they are down. remember, the problem suspect the numbers they are reporting, it's the valuations. we've had pulte with good numbers, merit tash, the numbers, two times book for most of the home building companies. two times book for most of the home building companies. women pool, the guidance spectacular, 9.24 to 9.75. right now, still at 9.25. >> 19 1/2.

>> to 19.75 on tri pointe homes. guys, back to you. >> whirlpool, all guidance. pulte coming in was up 15%. again, like facebook, some of the stocks had big moves, taking little profits. shift to bond and the dollar, rick santelli, the cm help. group in chicago. go ahead, rick. >> good morning, jim. we are look ac the how the fixed income markets are moving, seems to be bigger, pervasive conventional wisdom rate goes up, worked certainly for the month of january. you look at a two-day chart, you can see yesterday we spent a little more time above 2%, not true today. but a year-to-date chart will reveal we were at 176 the end of last year, up at 198, 21 basis points. third year, two-day chart, yes down a bit, yes, 320 seems to be their big level, 295 where they closed last year, up about 22

ba basis points. a curve in january, a bear market, higher yields, between the 10s and 30s, affectionately called the knob spread down here. foreign exchange quickly. look at the euro/yen, continues to forge higher and higher, you see on this chart, we are just a couple months away from three-year highs. if you look at the dollar again, one of the bright spots on the green back, which by the way, made new lows on the year and continues to hover at those levels, we are at the best level against the yep in 2 1/2 years, june of 2010. we want to monitor. david faber, viacom news? >> let's start with viacom. like to focus on these media companies, having followed them for so many years. doing this quarter perhaps, a bit more hope that aid see advertising revenues knocked down quite as much but investors don't seem to be scared off on

the quarter, they are talking more positively about the outlook in terms of what we can expect for the next quarter and for sequential improvement in those numbers. let's look inside the numbers we can, there is advertising, affiliate fees numbers for viacom. capital return such an important theme throughout the media business these days. no surprise and no shock there that they bought back 13 million shares, $700 million worth of stock, 3.85 billion remaining on a $10 billion buy back. do they at via come. generally, in terms of that quarter what we are hearing off the call right now from the company, we got some numbers for you if you want to take a look at them as well, in terms of media network, film entertainment, advertising, there it is, media networks, film, entertainment, many of the declines anticipated, trading about 11 times, mike nathanson's number for last year.

>> you remember in the '70s -- >> the analyst. in the '70s, red step brought it back in and took it back out. this buy back, dave virktd most aggressive buy back i've seen. >> it figures prominently. time warner cable bought back a decent amount of stock but to there are a lot of questions, e-mail from a media investment i talked to, looks like a mess, no clue what is going on, guidance awful, programming expenses out of control, what is going on in l.a.? remember, baseball, the dodgers, big programming expenses. so, margins are contracting. a lot of concern there about just typical operation of the company, despite free cash flow and other things measured, certainly not that bad but concerns among the investors base here in terms of margins, in terms of just what's happening in the way that they missed mar jirns and the operating results themselves. big buy back is helping there. take a look at it versus

comcast, because that is a peer, yes, we are owned by comcast, nonetheless, you conceded to comcast has been performing better for its operations are, see it in terms of the stock as well. so, that's one of the big losers on the day, time warper cable. up next, gauging the state of manufacturing in this economy. we will have breaking news on chicago pmi and ipo excitement building at the big board. how will tri pointe homes open in its wall street debut? talk to the ceo of the home builder after its first trade. as we head to break, look at the early movers here on wall street. to grow, we have to boost our social media visibility. more "likes." more tweets. so, beginning today, my son brock and his whole team will be our new senior social media strategists. any questions? since we make radiator valves wouldn't it be better if we just let fedex help us to expand to new markets?

hmm gotta admit that's better than a few "likes." i don't have the door code. who's that? he won a contest online to be ceo for the day. how am i supposed to run a business here without an office?! [ male announcer ] fast, reliable deliveries worldwide. fedex.

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and go. you can even take a full-size or above. and still pay the mid-size price. i could get used to this. [ male announcer ] yes, you could business pro. yes, you could. go national. go like a pro. january, chicago purchasing manufacturers are out it is a whopper. 55.6. this is coming from revised 50 right on the nose from december and 55.6 looks to be the best numbers for april of last year, so that is a positive surprise.

some of the confidence numbers, for example. we will continue to monitor this throughout the session. carl, back to you. >> all right, jim, once again, the data conflicts, post fiscal cliff. no fiscal cliff. people come back in buying stuff. >> consumer confidence, we have some january numbers that have not been pretty. >> has been very difficult to figure what is going on. >> they had the payroll tax increase that could have hit them. >> pmi, i think it's such an important number. shows worldwide growth could be picking up. >> start with citric systems. >> i'm comfortable sitting down. it didn't miss it is going higher. >> pioneer natural? >> 200,000 acres sold to a chinese company for $1.7 billion. stay with the oil stocks, but that one people thought was going to take our bid you didn't. >> fio.

>> this had been a darling because it does a lot of data management, big data it did miss. people think facebook is going to spend money on this one, hasn't happened yet. >> favorites, jerry veil. >> [ inaudible ] >> fbr. >> i thought this was magnificent quart and up 6. the main thing, not only -- maybe one. there's one or maybe two pockets left in this country. essaying there is is a major find that a couple oil companies have. we have got to find out which ones. we don't know yet. wouldn't tell us. >> finally, qualcomm. >> you know, geez, the four gs coming, this was magnificent. >> tph it is up 15 1/2% right here at the open. that round of applause you hear behind us. again, highly anticipated offering. bob? >> we have opened. $19.56. here's some of the executives here, doug bauer and the cfo.

they will it will be in a minute. the price talk here, originally, 11 million shares, they floated 13.7. price talk was 14 -- excuse me, 14 to 16, they priced it at 17, they opened at 19.56, now trading at 19.62. remember the positives here, number one, of course, backed by starwood. number two housing recovery. number two they bought a lot of cheap land in california. by the way, they will also be building, as well, starting in denver. guys, back to you. >> i thought they were appla applauding 6 in 60. >> really deserves an applause. >> nice to have a studio audience for a split second. when we come back, the ceo of tri pointe homes on that ipo, when we come right back. don't go away. ♪

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frye point homes on the big board this morning, shares of tph trading higher by 12.7%.

joining us at post 9, doug bauer. great to have you with us. >> thank you. >> a california home builder specializing in single-family homes. give us some insight into your market right now, your average selling prices, are they going higher and what do you see for the came market specifically? >> you know, the california markets are definitely in the first inning of a recovery. we recently expanded into colorado end of last year. our sweet spot for average selling price in california is about $450,000. generally speaking, we sell last year the improvement in the market the traffic and the conversion had been very strong and continues, actually you into the first four weeks of this year. so, we are very excited. and as i said, it's -- i think we are in the first inning. >> we have mortgage rates for the first time in the latest reading, the 15-year mortgage is above 3% since the fed started buying mbs. wondering if that is an impetus for people to get off the sidelines. do you think that will increase

demand in homes because people want to lock in rates? >> you know, housing is driven by jobs and in our markets from northern california to southern california, even the state of california has had great positive job growth. interest rates have definitely been a key factor in our -- in the industry coming back. but really, the consumer confidence dense and pricing, you know, case-shiller, all the other indices report, that gives a lot of confidence. >> hey, doug, can i get a residence two at the silver creek development for $1.3 million now, that you're sold out of residence one? >> we will work a deal for you jim. >> are you telling nee $1 million homes are selling out very quickly? >> they are. very strong up in northern california. you know, you look at the silicon valley, jim, from san francisco to san jose through november, we generated over 80,000 jobs, very high-paying jobs and the consumer up there really demands an excellent product. i mean, our product is both entry level to move up and that

product has been moving very well. >> at the same time, at the canned era, $300,000 homes temporarily flowed out. low priced and high priced. >> it's across the board, jim. the market from southern california, north san diego county, to northern california is definitely picking up. so, we're excited. it's an historic event for myself, my two partners, it's -- we are looking forward to t. >> what is the company going to do with the money that you're raising directly? obviously, your chairman, 45% owner, still selling some as well for star wood. what are you going to do with the proceed? >> the proceeds are going used to acquire 775 lots we have under control. so the neat thing about what we are doing, it is immediately accretive to the value of the company. it is not for general working capital purpose bus for real assets and that's really critical for our growth. >> you mentioned job growth in california. rick perry of texas going through that state saying, hey, they keep raising taxes here,

come to texas, lots of people moving over the border to nevada. do you worry at all, yes, they balanced the budget, but people do worry about taxes continuing to go up there. >> is a great question and obviously, california has high tax and high regulations but it's a great environment, a great state to do business. northern california, you've got the technology industry. every ten years, it reinvents itself. southern california is a very diverse economy. so, we are still pretty bullish on where the state's going. >> where are we in the narrative of the price of building materials? still climbing? is that going to even out? >> everybody has reported a lot of tightening and there has been tightening in the labor and subcontractor base, mostly labor because the subcontractors were wiped out for four or five years. i meet with them as we build our homes and they ask me, doug is this for real? because we had those artificial starts in 2009 and '10.

they see this is for real, going into the second inning you, they will start hiring. >> first inning? >> i think we are heading into the second. i will go year by year. you never know when you get rained out though. >> doug, thanks for coming by, we appreciate it. >> dunnen, want to promo anything else? >> sap just called, coming on tonight, allegedly had a shortfall, yet the stock is scorching higher. key, downgraded today, i disagree with the down grade, never do tv, going to be fabulous. >> someone who is going to go to new orleans, jim, growling need these? >> you are too kind. >> they don't take american express, master card or visa that is the currency there, you know this. >> i cannot wait, this is my second super bowl. not -- i'm not in it, david,ing on watching. >> sorry your eagles are not even close. >> but your pick is? >> the ravens have the magic. >> yes. >> really? >> destiny, man. destiny. we will see you next week. >> thank you so much.

>> a great time. >> when we come back, facebook after the earnings. is the rebound over for the social network? profits and the economy, an exclusive with the head of whirlpool. what is the growth cycle after a terrific 2012? keep it right here. hi. i'm henry winkler. and i'm here to tell homeowners that are 62 and older about a great way to live a better retirement. it's called a reverse mortgage. [ male announcer ] call right now to receive your free dvd and booklet with no obligation. it answers questions like how a reverse mortgage works, how much you qualify for, the ways to receive your money, and more. plus, when you call now, you'll get this magnifier with l.e.d. light

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that's how you kick off the 10 a.m. we will kick it off with facebook. the street is pilinging on the down grades, the stock's down. we have a silicon valley power player here to help us make sense of it all. plus it is the day after the blackberry ten launch and the street is not too keen on the big unveil are was the rebrand nothing more than a big, fat disappointment? in case you haven't noticed it is the last day of january, the s & p en route for the best january since '97, a negative read on jobs tomorrow is the rally in jeopardy? back to face book the social networking giant reporting

fourth quarter earnings after the bell last night, posting a big bead on the top and bottom lines. the stock is falling in today's session. more on the numbers, bring in julie boorstin. >> facebook earnings of 17 cents per share beat projections by 2% and revenue grew by 40%. face book official lay mobile company. the first time, more people accessed facebook every day on mobile devices than on the desktop. now, despite the beat, the stock fell after hours and the to sex trading more than 5% lower today, pulling back after moving more than 40% higher over the prior three months. many analysts are expressing concerns over the pace of mobbal growth and the increasing investment in headcount and research and development. the company stays plans to grow expenses by 50% this year. on the earnings call, ceo mark zuckerberg stress ready the skin vesting in things like grass search, which won't yield profits for the next few months.

>> we made deal six to grow our headcount quickly in 2013, particularly in product development this will likely grow faster than revenue. i spoke to cfo david evenersman, focused on the opportunity in mobile, saying it is very early on in its development. simon, over to you. >> thank you very much, julia what is the best strategy now for investing and monetizing you

the social space? david mcclure is the founding partner of 500 startups, an internet seed fund and inc. cube baiter program and ran the facebook fb fund incorporated cube baiter program in 2009. welcome to the program. thank you for joining us. >> thanks, good morning. the financial times says almost everything improves, almost nothing gets worse, apart from the fact that zuckerberg is going to increase expenses by 50 forced 1.4 billion. do you understand why people may be exiting the stock now? >> i don't. i think the market's reaction is oversold in short term, the same reaction went stock debut. mark is running the company for the long term. like jeff bezoe at amazos at am

>> they don't expect, according to management, a big contribution from the gifts e-commerce operation in the near term. looks like sandberg was, to a certain extent, guiding down, certainly expectations for a big shift in advertising from television to facebook in her ability to convince big advertisers to do that. >> the reach for facebook in terms of advertising is pretty much unlimited, users, continue to grow, pretty much everywhere except china. not sure why people are so negative for things. seems like nowhere to go but up for them. a trading start. these analysts can swivel on the head of a pin. that's their job if they see the evidence is changing. get six months down the line, more is proven. you are a different type of investors. >> we run an inc., cube bait and seed fund here, invest all over

the world as well as silicon valley, our timelines three to five years, if not longer, very bullish on facebook as channel for a lot of our startups. as well as twitter, youtube and media channels. the areas were face book popular, modernization is out in front of us but all the populations are growing, middle class is rising and mobile penetration is rising. points to good opportunities in the future. >> but the market is always the truth. you have to accept where things trade. that's the nature of the game here. when facebook is -- >> the numbers are going up, i think maybe just a little bit too short term focused on everything happening this quarter but the numbers are going up in pretty much every category. >> that's not true of all the kind of the fast-growing tech companies is it? for example, facebook earned four times as much this quarter in net revenue, as, for example, amazon did is but amazon traded

181 times earning. facebook now just 44. why the difference? >> i think the market is maybe more familiar with amazon in the long term and they have grown to trust maybe bezos spending ahead of results. they are probably still a little bit new with cheryl and mark and trying to see if their spending is going to result in future revenue and opportunities down the road. >> what is expecting now? where should investors be turning? facebook preeminent or better for listing companies, watching now people would be able to buy? >> i think you're seeing strong growth in a lot of different tech companies. certainly, facebook, google, apple and amazon are leading the way. i think you are seeing a whole wave of startups building products and services on top of those and really providing opportunities for people here in the u.s. and around the world a lot of them are not quite so crazy, tech startups as maybe we are used to. still be photo sharing, still be game playing but i think there is a lot of basic core usage

among consumer, education and business for software, internet and mobile products and a lot of those products reach people through tool its like facebook and twitter, professional networks like linkedin and youtube. think video is where a lot of things are going in the future. i think we are starting to see emerge gems in youtube and other platforms and video like hugh lieu. that's where i think there's a ton of opportunity coming out now. >> dave specialcically with facebook, i understand your argument it is a growth stock. the same time you look at the metrics so key to many investors, look at mobile, it doubled as percent of revenue from the third quarter to the fourth quarter right, now 23% of revenue. total ad revenue was basically flat in the same time period, indicates the mix shift is not benefiting shareholders because the overall revenues are not going higher. as the company moves more and more toward mobile it does appear it won't necessarily be able to gain traction on that in the next couple of quarters.

>> right. i think what people are look saying the cannibalization of typical web display ads with mobile ads and there's probably right now, at least, a smaller revenue per customer per ad that is going to be gained. the long term, again, i think they are improving -- how many companies have your segment spending in an area doubled and quartered? i think you will see facebook's investments in mobile and other areas rise up quarter after quarter. even though most of the audience shifting from web to mobile, both in the u.s. and around the world, i think you will see facebook discover more and better ways to target customers, make sure those ads are relevant and you will see rising advertising revenue from mobile, just as that mobile revenue is coming from different parts of the world as well. >> do you think google is a more exciting opportunity, that said? >> i think most of what's interesting about google is really reaching out on android. starting to see android present a big opportunity and some extent, maybe a challenge for apple, at least in terms of unit sales. apple probably right now is

still drawing in more revenue per user in terms of applications. from a developer perspective, the future looks pretty right for mobile applications development but google is becoming quite a large player at the android opportunity and people keep forgetting about youtube, i still think that us tube is one of the untold stories in the valley. actually started by some friends of mine at paypal. i think one of the smartest purchases google ever made. now you will see tons of independent contract producers on youtube start to make money. >> any doubt in your mind they start charging users to access their own content? >> i thank you model for paid subscripti subscriptions, which youtube announced they had be running out, also model for broadcast content but combining that with commerce and other types of subscription content there is a product being sold, we are investors in a company called ipsy. michelle tip is very visible blogger around beauty and fashion products. she has got audience of millions herself and i think it's not going to be just advertising revenue that makes those types

of businesses go, but the actual products as well. i think you will see the standard models for video on television start moving over into internet broadcast areas. >> dave, great to see you on the program. thank you for getting up so early to join us from california. nice to see you. dave mcclure from california. >> thank you very much. all right, we got a mover near the audio products phase irk let's get to josh lipton for a market flash. hi, josh. >> hey, melissa. watching harmon international dropping like a rock now the audio systemsmaker cutting its full-year outlook after second-quarter profit missed estimates because of lower sales to european carmakers. carl, back to you. >> josh, this your first time on "squawk on the street"? >> it is not, carl. yesterday. yesterday was the maiden voyage. >> welcome. >> thank you. >> welcome. good to have you in-house. josh lipton joining us from headquarters. when we come back, the fed holding onto its easing stance. what all right first jobs number of 2013 bring tomorrow?

r.i.m. continuing after the blackberry tint unvachlt was the big launch a disappointment or not? does the stock tell us anything? we will be right back. [ male announcer] surprise -- you're having triplets.

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big day in the stock yesterday. shares down 7% on the n:nbc news line, jennifer frichy. good morning to you. a classic sell on the news or a reel belief the company is in a weakened position or both. sounds like you might be more of the latter. >> yes, i think it wasn't

enough. we still have real strong doubts. ville more related to the model and the service revenue changes which was very high margin and revenue stream for them. >> do you believe it is not revolutionary enough or is that not the point? >> the buzz around the phone was quite good from a lot of reviewers and it's competitive. for r.i.m. it is too late. they are making less on the service revenue aspect of it you look at it motorola provided a very good example, just very hard to make money, even when your shipping 30 to 50 million a year. that is a slippery slope that r.i.m. is changing. >> those who aren't aware, services is where the margins are fatter, the majority of gross project, the sweet spot?

>> a third of r.i.m.'s revenue comes from service revenue. we estimate and we don't know for sure, but about 90% of the profits. we are sure the handset is a negative operating margin. >> talk about their marketing support. hypes on the "today" show talking about spending several hundreds of millions ol dollars in the next quarter, we know about the super bowl add sunday, $2 billion in cash, enough there there? >> a lot of people, the bulls on the stock will look at the cash value, point to the fact $5 in change in cash value alone. i think that is irrelevant. we have them burning almost 700 million in cash next year. that might even be conservative because we really, as you mentioned, they talked about 100 million spent to mark threat thing. we have to bring that number up, put more drain on the cash number. >> spending more to market this

the same time, jennifer, coming out to market at a delay once again. there is a strong belief that samsung will come out with another competitive product around the galaxy family before that time. you know, while you can get it to be fair to r.i.m. and other countries this week, even tomorrow r tomorrow, the u.s. testing process could make that march timeframe be later march, puts it every week here so critical. >> people have compassion for

thorsten heins, given a hospital pass by the founders when he took over the company. he has bought companies to make it trendier, the touch screen facility a big pet beth on the way people might use phones in the future, he has brought in to market ex7,000 apps with it -- 70,000, i beg you pardon, apps with it. what more could the man have done realistically against samsung sand apple? anything could have done yesterday to have held that stock up? >> to be very fair, you were right, he was dealt a very difficult hand when he stepped into this role. he has been -- he has done what he could with a very bad lot. however, however, i think the market is against him. you mention $70,000 apps, simon, but there are some that are missing and it becomes a chicken and egg type thing, people will come to them only if certain

apps are there and if -- if those apps -- if people come, the apps probably will come. necessary a very tough position and i think he's done the best co-with a very difficult hand. >> last question, you know, some argue that maybe their best foot forward would have been to put the keyboard -- the q up first. targeting the people waiting for a new keyboard device for a while would that have mattered? >> i think there is blackberry loyalists do stay for the keyboard alone. there is something to be said for that, but that is coming likely in april. it is what it is, a lot of doubts and a lot of uncertainty about what the model will look like because of there world of the high margin revenue stream for them. >> talk about a competitive space. general fir, thanks for a your time. >> thanks, carl.

>> jennifer fritzsche at wells. >> send it back to josh lipton with a market flash. >> that's right, simon this one for the gamers, take two shares are dropping. the reason, grand theft auto 5 now launching in september "in order to allow additional development time. investors disappointed by that headline. carl, back to you. >> thank you so much, josh. still ahead, an inside look at how the uberrich are decking out their private jets en route to the super bowl. we are gonna take inside one next. but first, our own tyler mathisen is getting a little bit morbid, not too morbid and going underground, way underground. >> later on "squawk on the street" and later tonight on the documentary, "death, it's a living" we're gonna take you inside the funeral business. want to know when most people die? no, the answer isn't when they stop breathing. they die in the winter months. look at this chart of the mortality rate and how they rise every month in the fall. just because we are cnb krrks we thought we would lay the s & p

500 over the mortality rate. is your portfolio killing you? the s & p went down in 2009, look at the spike in the death ray. more on "squawk on the street," after that. all stations come over to mission a for a final go. this is for real this time. step seven point two one two. verify and lock. command is locked. five seconds. three, two, one. standing by for capture. the most innovative software on the planet... dragon is captured. is connecting today's leading companies to places beyond it. siemens. answers.

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u.s. dollar moving lower after breaking the mark for the first time in months. is this the beginning of a trend? get to the money motion trade of the day? kathy, the first rule in currency trading, the trend is your friendsome it in this case? >> i don't think some the decline you have seen today is very, very small. in fact, i would even say that the uptrend remains intact. if anything, look at this opportunity in the eurodollar to actually pick up some bargains. i like, you know, riding with the momentum, like you said, the trend is your friend, but don't be confused by this temporary dip. i think nothing but that at this point. >> looking to get long euro u.s. dollar what are your levels and how do you get to your target at this point? >> i think that we are seeing a little bit of a pull back. two types of strategies you can

do, buy the pull back or buy it in a breakout. i think the smarter thing to do right now because we are seeing consolidation is to buy on a break of 137 stock at 135 and target of 137.75. i think all the factors we was been talking about the past couple of weeks including capital flowing back into the eurozo eurozone, very good german data overall. blessing of the ecb -- >> other jobs report on friday? >> i think that, you know, right now, really a longer term view. 135 a significant support level, a breakout point. as a result, not too worried about t. >> kathy, thanks for stopping by, kathy lien at bks. men racials in high gear for super bowl xlvii sun is day.

but what about how you plan tie life at the big game? robert frank joins us with a look at how the uberrich are arriving in style. i got to see this. >> thanks. super sports fans, the path to the super bowl is on board a private jet. more than 1,000 private jets will go to new orleans on sunday, nearing the all-time record. knelt jet's executive adam johnson told me yesterday demand for its planes may be even stronger that last year. check out the latest addition to the net jets fleet, the bombardier 6,000, stocked for the big game. customers like their planes outfitted for the super bowl with jerseys, t-shirts, footballs, hats and other nfl paraphernalia. when it comes to food and drinks, private jets make for the ultimate tailgating party. customers are asking for catered sliders, bigs in a blanket, nachos, all paired with fine bore dose and dom perignon. they may be rich but still just guys going to a football game. the price for all this luxury, around 18 to $20,000 a round

trip for a light jet, about seven passengers or $30,000 for a little roomier ride, super bowl cake not included. >> i think of millionaires and billionaires going to the game, i think a lot more are gonna come from san francisco than baltimore, right? >> it is very market dependent, although what i learned is that the private jet industry roots for new york teams. when there's a new york team in the super bowl, like we had last year with the giants and the patriots, apparently, that is the big definer of bigger demand. san francisco okay market, the big demand is along the eastern seaboard that's why this year is going to be lighter. >> i love the line in that dom perignon, bordeaux, guys going to a game p really? >> sliders. >> dom perignon? >> i was talking to the caterers and private jet companies what the guys are putting on board the planes is this tailgate food, slider, nachos, but really good bore dose, lafitte, mouton,

dom perignon. >> still got to wait in line when they get to the game or is there some special line for the uberrich? >> the jet companies apparently have lined up cars, access, so it will be seamless for these people. not just paying for the plane. >> these people. you're not going yourself then? >> not going. i will see it from my luxury first-class couch. >> i imagine on your beat you get invited from time to time and you have to say, look, can't go there with you. >> i do get invite ready, i do have to say can't go there. this plane, i was allowed to get on the plane, on the ground, it was a nice plane. fun. >> bombardier 6,000. thanks, robert. see you soon. after the break, breaking news on natural gas inventories, after the rally so far this week, all right data push it even higher? plus, the dow closing, where are we now? we are 86 points shy of dow 14,000. we will talk about the rally next on cnbc.

welcome back to "squawk on the street," i'm sharon epperson. natural gas users are selling off right now, after we got a number from the energy department. that was a withdrawal that was less than what analysts were anticipating. saw a draw of 194 billion cubic feet of natural gas from storage in the last week. expectations were somewhere

between 200 and 204 cubic feet. still the biggest withdrawal of the season. the very cold temperatures we had last week in the northeast, the midwest, even texas, a big reason for the withdrawal that we are seeing but it's not what analysts had anticipated. we are going to have colder temperatures in the week ahead, but still, we are looking at natural gas, trying to hold that support level around 3.25. that was the low when that number came out. if we dip below 320, traders say, technically we could see a drop all the way to the 310 level what traders are watching now. that was highly anticipated report because it is the biggest of the season, but wasn't as big as what some analysts anticipated. melissa, back to you. >> sharon epperson. thank you. negative reading on fourth quarter gdp yesterday surprise the mark, the first jobs report of the year is out tomorrow, cnbc senior economics reporter steve liesman wants to look first at something else, all those early dividend payments having a major macroimpact. steve? >> yeah, melissa, i can't help myself. isn't of the than something comes along that dramatically changes the look of some of the

long-term economic charts we look at every day. the early dividend payments of december made from all the companies paid ahead of the fiscal cliff fears and tax hikes, they have done just that. get to that chart in just a second. first, i want to show you the data here, personal income in december up a whopping 2.6% but spending up only 0.2%. well, it wasn't wages that drove personal income. what was it? it was dividends, up 33%. because that huge dividend payment wasn't spent, the savings rate surges 6 1/2% to 4.1%. here is the chart we are talking about. dividends go along, they surge, in the 50 year of data that i have there, there's nothing like these two points in any of the other points of time there the first payment analyzez out to 235 billion. ahead of the tax years, 268 billion in december of 2012. of course, we will pay for this

surge, the surge in dividends at & ul rate, borrow from this year, dividends rising, still a ways to go to get back to the '08 level. but if we ever do, but this surely means fewer dividend payments for the rest of this year. there is an upside of this, of course, helps government revenue. the treasury having its best december since that tame 2004 december month with a gain. that is up from december a year ago there is the chart that we are talking about this is the month on month year-on-year change for december, going back to 1994. of course this dividend sloshing around could help stocks in january if it's not spent, got to be invested. some ends up in stocks, see if some ends up in spending. >> interesting. you got to wonder if the rotation into stocks out of bonds was that or if it was

rotation out of dividend payment nice stocks. >> some people plot it back in, go back into stocks. >> your thoughts on mfp tomorrow and the degree which the last few weeks of claims point to what the number may be? >> carl, our viewers quite so hip that nfp goes unexplained? it is up to you. non-farm pay rolls. the jobs report tomorrow? >> yeah. >> i think it's an interesting question right now the negative gdp number, questioning the with government didn't spend money, result in more federal government firing that's one. two, is the claims picture cloudier than we thought it was? what happened, we had seasonal adjustment, seasonal declines in claims, now they surged right back up. i think all of this points to a 150,000 jobs number because if you figure claims were in that 350 to 360 range, carl, then i think that sort of equates best

to a 150, maybe a slight decline in the unemployment rate. but i think that a lot is riding on tomorrow and the view of the markets on the economy, a weaker than expected number would tend to jibe with that negative gdp report we got and cause people to rethink how big the growth is in the economy right now. >> steve liesman, thank you. and we do have some breaking news you see at the bottom of your screen regarding anheuser-busch proposed make tankover of group poe modell. go to josh at the markets desk. >> lawsuit today filed challenges anheuser busch inbev's proposed acquisition of total ownership of group poe modell low. >> very quickly, the worst performer for the day on the s & p, 20% no small move. thanks a lot, josh. last trading day of january

under way, the market trying to shrug off this negative read on gdp yesterday. let's not forget we do have jobs tomorrow. can the rally continue? want to bring in the vice chairman, director of research at aerial investments and a chief economist at a research group. good morning to you both, gentlemen r >> good morning. >> did yesterday's negative print give you pause? should it give all of us pause? >> i was disappointed with the number f it had come out of corporate spending or consumer spending, i would be concerned. it was government spending and growth that went down that makes me happy. >> the headlines start saying it's not so bad there are special items, the white house saying these numbers can be volatile. obviously that gave us lot of

ammunition to skeptics. you? >> well, charles is right in his evaluation of fourth quarter real gdp. still no denying the reality this is the limpest economic recovery since the second world war and i believe before the entire year, real gdp growth will slow from 2012's 2.2% to merely 2%. we have a lot of fiscal drag because of recent tax hikes. as we come to the end of 2013, i'm worried how small businesses will deal with the impending arrival of health care reform. >> bridge us to a point you brought up, charlie. we have the sequester coming up and do have the cliff debate. rather the debt limit debate. policy risk, unlike writing dodd

frank and obama care, shifted to guns and immigration and expect those to have less of an impact on the market. >> exactly right. compare what the obama administration is focused on and proposing right now to what is focused on four years ago and it is much better. four years ago, we were staring at obama care, dodd frank, cap in trade, card check, a long list of stuff bad for business. now focused on guns, immigration, gay marriage, these things you may like them, may not like them, they are not bad for business. >> john, i'm interested in your pessimism, a market which so far this year, this months, gained 5%. when we are eyeing dow 14,000, would appear that some retail money is coming into stocks. your he arguing the situation is bad, the market is rallying, they are coming back into it, they can profit from it moving through the year. are they wrong?

>> sorry. >> john? >> john? >> the situation is lackluster, add it is strifg the market more so than improved outlook for profitability is the expectation that bond yields will remain low for a extended period of time. by the way, you know, the corporate bond market has begun to sour a bit we have had the past week, a notable spreading of credit spreads for junk bonds as well as lower grade investment grade. >> charlie, is he right? i thought the talk now was the steepening of the yield curve forced people out of bonds into gold, out of stocks here. that is the bigger issue, isn't it? >> the bond market is weakening for good reasons, we are going to have growth, we are going to have improved loan demand. whip housing starts increase,

employment going to drop, get better loan demand, great for banks, i think we have a very virtuous cycle here, we could have dropping unemployment. everybody is projecting this anemic growth for the future but a good chance we will end the year at 3 to 4% growth. >> we will see. dow jones just now reporting the jobs council, the white house jobs council you can the charter ex-mires thursday and not being renewed, according to an official, maybe a problem solved. >> one more piece of good news. m and a environment getting strong. see wms getting a bid today. did he going to get taken over. the long-awaited boom we really think in m and a activity is finally going to start and that is gag golden gate to be good for stocks. >> put alicia keys in charge. seems to work for most questions. >> actually it didn't, r.i.m. is down again today. >> thanks, guys. see you later. as we mentioned, tomorrow's january jobs report means another opportunity for you to e-mail the number.

tweet us your predictions for the january non-farm payroll figure. this month's prize will make you feel nice and cozy, just in time for valentine's day it is a blanket autographed by the "squawk on the street" gang. you will have one minute before friday, the release friday you 8:30 a.m. eastern time, to send us your predictions, good luck. this is the blanket here. in all its fleecy glory. and it just -- it's nice. >> did you tuck a stock tip in there? >> cramer has one all the way -- no. it's pristine. never been opened. never been used. a great prize. >> maybe we should open it so people know how big it is, know whether it is worth tweeting. it could be quite small. >> it's bigger than a doylely, leave it at that. next on the program, ups missing expectations this morning, what the numbers -- there you are. what do the numbers mean for the economy as a whole and should you be taking profits on the transport? stay with us. [ engine revving ]

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as for anheuser busch, that stock is down by almost 5% at this hour as well. so this is of course, a story that we are watching at this hour and we are gathering some more information on it. i believe that david faber is coming to the post now with some more reporting on this story, of course, one that had originally seen shares of stz halted and -- >> consolation is the exclusive distributor, kayla tausche writes. bring in kayla tausche. what more can you tell us about that? >> risk arb hedge funds that trade news on mergers and

acquisitions were in stars, stz, a derivative play to this deal, expecting eventually one day down the line that anheus anheuser-busch would buy constellation to capture that business. he did have the exclusive agreement to distribute corona in the united states. core rope nah is the flagship brand of modell low. a huge hit to a lot of hedge funds and raiders in that stock. you can see them selling, selling, selling, as soon as that news came out that the department of justice would be seeking to block that deal. reports about a moment ago said that the justice department had been asking anheuser busch to sell a couple of the plants that produce this beer and unwilling to do so, reported by reuters and unconfirmed by us. that was the speculation what was going on behind the scene scenes there. >> thank you. david faber joined us from post nine. make phone calls. >> what i like to try to do speaking of people behind this

deal, i think they are quite surprised that the department of justice has chosen to act here, if you want to go back, of course, the last time we saw a major opposition to a deal would have been at&t's purchase of t mobile, which was opposed by the doj. constellation brands, remember, entered into a long-term distribution deal with anheuser-busch for group poe modell low products seen as a great deal for constellation.up products seen as a great deal for constellation. by the way, it owns 50% of grupo modelo, what it doesn't own to not go through, constellation would not have that incredible distribution deal that its stock rose dramatically on when it was announced when this original deal was announced. judging at least from some of the conversations i've been able to have, this deal may go to trial. again, the people involved in putting this deal together tell me it was wholly unexpected that the doj would step in to try to

oppose it. but that being the case, we will see. in fact, if it does go to trial, again, just for the record, anheuser-busch already owned 50% of grupo modelo. they got that as a result of the inbev deal way back when and going to purchase the remainder of it. by the way, as for grupo modelo, which had a very high multiple, about 18 times, if this deal is oppos opposed successfully, you can imagine that would go down as well because there is only one potential acquirer for grupo modelo and that anheuser-busch, which is 50%. keep an eye on grouper modell low, anheuser-busch, justice and most importantly, constellation brands as mover because, again this well-struck distribution deal that they had may be going away if this deal is turned down. >> too early to start asking questions about whether or not the character of justice is changing this year? second arm determine of a

presidency, so forth? >> people will start asking that question. they have not been present as some might have anticipated during the first four yearser of the obama administration. again perks the most high profile one being the t mobile/at&t deal. yeah, carl, certainly start to get those questions. apparently the bear market is highly concentrated according to the doj and this would making the concentration too high. >> a time the s.e.c. is becoming more hawkish as look at the li investigations, the step is toward criminal charges. maybe the second term makes a difference. >> thank you very much. when we come back santelli will give us the lowdown on growth forecast versus reality.

welcome back to "squawk on the street." we have a statement from anheuser-busch imbev regarding the doj intention to block its purchase of what it doesn't already own of modelo. anheuser-busch saying this

morning that the doj's actions seeking to block the proposed combination is inconsistent with the law. the facts and the reality of the marketplace, the company's announced an agreement of course they point out back in june in which they would have acquired that remaining stake it didn't already own. they go on to say most importantly they will vigorously contest the doj's action in federal court and given today's development no longer expect the deal to close during the first quarter of 2013. they'll comment further once they've reviewed that filing. it appears we may have a chance to go to court here and see if in fact the doj's argument holds sway for a deal that was an important one for anheuser-busch, not wholly unexpected, had been spec clapted for a long time, announced last june along with a distribution agreement with constellation brands, shares of which are down 20%, i don't believe they're halted any longer and in part they were relying on that distribution deal as a way to say hey, we're

not going to be in control fully here because constellation as the distributor will have significant rights in this, apparently not enough to get the doj to back off, a surprise this morning by this action. carl? >> thank you very much, david. let's get to the cme group, rick santelli with the santelli exchange. rick? >> good morning, carl. lot of traders on this floor and many times i ask them what they think about the markets, and if you ask ten people, you get about 12 different opinions. we all know how that goes. forecasting is not easy, trying to pick where interest rates go in an hour, tomorrow, in a week, that's difficult. to try to do it for a year or years down the road, truly next to impossible, but when you invest for yourself, you might have an idea, but you're always going to remain fluid because if you're not fluid, and you don't ebb and flow, it isn't that you're a flip-flopper.

when you're a trader the word flip-flop doesn't exist. either you're fluid or they carry you out. mutual funds, many of you are investors, some of you do some of it yourself, all of yourself but many farm some of this out, mutual funds. when you decide where to put your money you look at their forecasting how accurate is it. if they look like they're accurate and turns out they're not on a winning streak you can always move it. when it comes to the federal reserve there's been a lot of talk of late of their forecaster, maybe some of their original forecasts like in 2010, where were they thinking we'd be in 2012? well it morphed a little bit, 3.5% to 4% range. what did we learn yesterday the fourth quarter was down 0.1%. let's start at the beginning, what was the first quarter 2%, second quarter 1.3%, the third quarter was the best 3.1 and of course the minus. now i'm not saying what they are do something easy. as a matter of fact i'm going the other way. i think what the fed's trying to

do is impossible and when you think that their forecasts were so wrong in 2010 for when we are in 2012 think about where that is on the spectrum of complication. they are trying to tweet tweak the entire economy. i don't think they can be successful. many think they should get off crisis mode for the first issue but the second issue is when you can't control all the pieces in a rubik's cube the size of mt. rushmore maybe we should look toward what's worked in the past, market forces. let market forces take over. you have a huge inventory of treasuries but sooner or later the market will force you to match sales to control the velocity of money sometime down the road and boy, we sure hope it comes sooner rather than later. carl, back to you. >> rick, see you in a few moments. rick santelli, thanks. let's look at the real estate business, permanent real estate to be exact, 86,000 people have already chosen to rest their bones at maplegrove

cemetery in new york but the perfect place to spend eternity can come with a hefty price tag. tyler mathisen has the story. >> reporter: what is the most expensive of the places to be buried here? >> that maplegrove there. >> reporter: 150,000. >> right here, yes. >> reporter: in this monument here? >> this monument here, you're paying for the monument. >> reporter: so 150,000 to be on this side. >> yes. >> reporter: 150,000 to be on the other side? >> on the other side. >> and on each of the flanks. >> $75,000. >> reporter: and how many bodies would go here? >> right here, six, six bodies would go here. >> reporter: a condo then. >> it's a condo. >> reporter: but you haven't sold any. >> haven't sold any. >> reporter: they're not dying to get in. >> not at $150,000, no. >> tyler joins us from cnbc headquarters. so $150,000 per person, six people in that area? >> 150,000 on the front side, 150,000 on the back side, 75,000

on either of the flanks there, so you figure $300,000, $450,000 to be buried at that place in maple grove, a business by the way that pulls in about $4 million a year in total revenue, it is a not-for-profit, $4 million in total revenue and it barely breaks even. they say they can continue to operate for the next 60, 70 years with no problem. they've got that much space but obviously it is death, a living, it is a business that employs something like 120,000 people in this country overall, melissa. >> fascinating business, tyler. >> and a great monument. that's a great monument to be buried under. >> it's available, simon. >> i'm thinking of booking it myself. it's cheaper than a manhattan apartment by far. >> $150,000 and one of the newest things is putting the qr codes on your tombstone so you can go with your cell phone and you can then find out more about the individual who is buried there.

>> no, no! >> you can find out more about "death, it's a living" tonight at 9:00, it premieres at 9:00 p.m. eastern and pacific tonight, the business of death. >> surely the point is to choose your own epitaph, not have yourself wiki'd on the tombstone. you don't want people to reedit. he was bold or whatever it is. >> imagine how quaint those things will be in 50 years. people won't know what those things are. >> tombstones? >> the body may go but facebook lives forever so you can link right back to your facebook and tell the true story of your life or of aunt matilda's. >> when they said who should we get to cover the hereafter, they said let's get tyler. >> thanks. >> we'll see you tonight, ty, very nice. what's coming up tonight? >> super bowl preview, eric robbin, cohead of energy at goldman sachs is now the nfl, he'll joining us from new orleans and monies coming out of

treasuries, going elsewhere in fixed income, we'll tell you where with dodd kissley of blackrock. >> simon david making calls on cost lag constellation. here's what you missed earlier on. welcome to hour three of "squawk on the street." here's what's happening so far. >> we have to see who is going to be successful at auction and frankly, the way this has gone so far, i think the auction on the cake side, the twinkie side will be wild and woolly. >> i think 16,000 to 17,000 is a very strong possibility. this could be a real double-digit year. >> oh, wow. >> this is what we want from great american companies, so i'm not against what they're doing. it may not be a reason to go buy the stock because people don't want to hear 50% increase in expenses but if you want to win, game, set, match, like they do, you do exactly what zuckerberg is talking about. >> this is a great bull market. it is.

i mean, the average is going up big. transports, could we go for a breather? it would make sense but the fed is not stopping. [ bell ringing ] >> interest rates have definitely been a key factor in the industry coming back but really the consumer confidence in pricing, you know, case-schiller and the other indices give a lot of confidence. >> the buys on the phone was good from viewers and it's competitive but i think for r.i.m. it's a little too late. good thursday morning. we're live at post 9 at the new york stock exchange. the dow, s&p, nasdaq had red arrows yesterday, a couple more today, dow is down about 12 points, s&p back below 1,500, to

1,499. qualcomm posted strong first quarter results after the bell, the company also issuing a forecast that was ahead of expectations. shares of r.i.m. down sharply after releasing the blackberry ten, evercorps taking it to underweight from equal weight, credit suisse cutting it from underperform to neutral. facebook getting no love from the street after reporting results last night down after the bell, is the slide of buying opportunity or should you steer clear of the stock for now? we'll tell you how to play it. the ceo of whirlpool will join us for an exclusive interview. the stock is trading at a new 52-week high. we'll find out if they can keep the momentum going. i-fans from around the country are descending on san francisco as the macworld expo kicks off, we'll see what consumers are saying about apple's latest gadgets. and the director responsible for "transformers" and "bad boy"

michael bay will talk about hollywood oscars, super bowl competition and more. we'll look at constellation brands the justice department filing suit to block the purchase of grupo modelo which affects consolation, the worst performer on the company. hampton pearson will update us. >> we have details from the justice department lawsuit blocking the proposed merger of anheuser-busch, imbev and grupo modelo. the justice department says it would lessen competition as a whole and 26 metropolitan areas across the u.s. resulting in consumers paying more for beer and having fewer new products from which to choose because of the size of the beer market in the u.s. the justice department says a small increase in the price of beer could result in billions of dollars of harm to american consumers. the department's lawsuit was filed in u.s. district court.

this quote from bill bair "the department is taking an action to stop an action because it would result in less competition, higher beer prices for american consumers, abi and modelo the largest and third largest beer makers control 46% of the annual sales in the u.s." that according to the justice department and as you've been reporting stocks of major beer companies have been basically getting hit hard, and constellation in particular getting hit hard because of its distribution role in all of this. also a statement from anheuser-busch saying it will vigorously contest this proposed lawsuit from the justice department. back to you guys. >> hampton, thanks for setting that stage for us. faber is here to talk about what's behind the scenes. >> this is the highest profile opposition we've gotten from the doj since it moved to block at&t's purchase of t-mobile and

one fully unexpected i can tell you at least by the participants in the deal itself. this is a deal that by the way had already been approved by anti-trust regulators in mexico and in europe, and it also had an important component of it that many behind it felt was going to make it immune to such a challenge, namely this distribution agreement with constellation, one of the reasons why that stock is down so sharply. crown, the importer of corona into the u.s., 50% owned by grupo modelo being sold to constellation as part of this deal and the extension of a significant distribution deal so you would get anheuser-busch basically saying hey we're not distributing corona in the u.s. crown is. we don't own crown. constellation owns crown, hence we're not going to have a great deal of influence on prices, we're not going to be anti-competitive as a result of putting a corona and of course bud light together. that clearly didn't pass muster at the doj, which has chosen to

file that anti-trust lawsuit, but again, that was an important component of this deal and a very important one for constellation. its shares went up dramatically on that news when it was first announced back in june when we saw this deal and they are now retreating today, just to put it again in perspective for you, of course, anheuser-busch inbev was going to buy the remainder in the deal and grupo modelo carl there's only one buyer for the company and it was anheuser-busch. if this were to not occur any takeover is perhaps in the multiple as well there as you watch all of these companies that brew a lot of beer down today, the idea being if the doj is coming in here, you're not going to see any further consolidation of what has been a traumtcally consolidating industry worldwide for the last number of years. >> although people will start to wonder i can think of other industries that have consolid e consolidat

consolidated, too. is justice going to flex their muscles the way they are on beer? >> that will be a key question that's raised here again in part because i have to tell you, it was not expected. t-mobile, at&t, from day one, we wondered, and we said, man, can this pass muster when you get two and three together, whatever the numbers were, one and three in an industry such as that, you've got to wonder whether they came. on this one, frankly i got to tell you, it was not something that was discussed by market participants nor expected by those who were behind moat modelo and anheuser-busch. >> well, i guess we'll see them in court eventually. >> it may very well end up there. >> david, thanks a lot. let's move on to facebook this morning. the good news for investors they're figuring out how to make some money from mobile. the bad news, company's mobile focus took a toll on margins in the fourth quarter and profit fell 79%. i'm joined by analysts with differing views on the stock. guy, good morning to both of you. >> hi there.

>> good morning. >> arvin, the general take this morning has been if you're in it for the long haul, why wouldn't you stick with it even though expenses are going to go way up. is this a misguided view? >> i think that's the right view because they're investing in product and development, that's exactly what you would want them to do and this is a short term hit and i think there is definitely operating leverage in the model but right now they're choosing to invest because they see a lot of opportunity ahead. >> evan, of course the warning signs would be the quarter, the trajectory appeared to slow during the pace of the quarter and we have seen examples where companies invested and sg&a, i can think of a couple, i'm sure you can, too, got out ahead of them too far. is that a danger here? >> sure that's always a danger with companies in the valley and i think with what investors have lived through with google during their evolution i think some people are a little cynical about that but i think arvin is right, this is mostly a

near-term hit. the other thing is more disappointing is just where this is relative to expectations right now and we need to make sure that we have the horse in front of the cart and we're not getting too optimistic about the near-term monetization as well. there were some squishy datapoints around that as well. >> really? one of the nice things that was said last night is gosh, these guys have great metrics, they're being transparent on things that other companies might not allow you to see. arvin do you think that's fair? >> yes, look, i think they sort of gave a mobile number last quarter, they said 3 million a day, and i think people took that to mean that was just the starting point and i think extrapolated that to mean $3.5 million to $4 million averaged daily. we were hearing mobile numbers in the $350 million, $360 million range which by the way we think they can do in the first quarter but expectations got too aggressive and the stock given the run it had was building a lot of momentum, and

today it's giving back so i think it's actually healthy for the stock, i think for investors who have been waiting to get in, this is i think a good opportunity this morning. >> our apologies to evan, we lost his shot, we appreciate his time. last question to you, arvin, your price target's 37, if i'm not mistaken. >> that's right. >> is there a population of people who rode this down to 17, are waiting to get back even in the mid-30s and once it gets there, they're out? >> i think people who are keeping an eye on the ultimate prize which is these guys are going to be a dominant player in online advertising and it will take a while. when you think about gifts in terms of e-commerce, you think about some of the new ad products they've got coming out, those are things that will take some time to develop. those will require some investments, but i think ultimately these guys will be a dominant player in online advertising and there should be a core holding in internet

portfolio. >> arvin, thanks for your time. we'll see you next time. when we come back it's one of the best reads on consumers in the economy, it's whirlpool trading near some one-year highs after fourth quarter results. ceo jeff fettig will join us to talk housing and a lot more. rick santelli is talking with congressman james lang foford i 15. >> yes, and of course there's only topic i'm interested in, the sequester, the continuing resolutions, part two, part three, actually delayed part twos and threes of the fiscal cliff so you want to stay tuned, see if the fiscal conservatives have a strategy and see what it is, in 15 minutes. [ male announcer ] at his current pace,

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let's take a look at the s&p home builder's sector, trading lower as tripoint homes makes its trading debut and we want to get more details on polte. >> it is down in the red today, the home builder pulte said profit jumped four-fold and new owners rose nearly 30% in tfour quarter but analysts worry the

company was at risk of buying back bad mortgages that originated during the subprime hey day. pulte up some 170% in the past year. carl back to you. >> josh, what a chart, thank you so much for that. whirlpool one of the leading home appliance makers out with fourth quarter results that beat estimates. shares of the company you know up more than 100% over the last year and hitting a new 52-week high this morning. joining us on the cnbc newsline for an exclusive is jeff fettig, the chairman and ceo of whirlpool. welcome back. >> good morning, carl, it's a pleasure to be here. >> one of the big takeaways from the quarter and the year is just how much pricing has improved, even if volume sort of lags what housing's doing overall. is that sort of where we are? >> well, carl, it's a combination of a lot of things. we said a year ago that our focus in what is still a very depressed demand environment, coupled with very high raw

material costs and inflation emerging markets it is imperative we expand our operating margins. we took a number of actions to do this, including reducing our fixed costs, driving very strong on product ifts. we did take some price increases, but equally important we drove mix, meaning that our investments from new product innovations really have been a great success in the marketplace. they have higher margins, and that also added to it, so a combination of all those factors enabled us to have a really terrific year in terms of margin improvement last year. >> so is 2013, does it set the stage for a ramping up of volume growth? >> we see a better outlook. as we talk about the business, we have strong momentum coming into the year. we've given guidance that global demand will be higher, modestly higher than last year, and that

the things that enabled us to perform in 2012 are similar in 2013, although different proportions, for example, we expect to continue to get good mix. we think productivity will be even stronger given a somewhat easy raw material prices, they're still going up, but we do see demand and in fact in the united states we're forecasting 2% to 3% off of very low levels. we're seeing good momentum in the housing market right now. we still have weak consumer confidence that hurts, but i think as we progress throughout the year, if there's no major disruptions that we'll see this ramping up as we go throughout the year. >> would you say you're more set to pivot around what new homes do or what renovations do at this point? >> well, our demand drivers in the appliance industry are really drawing on three things, one is replacement market, in other words your product breaks, you go out and get a new one, and that's about half of the

market, and that's operating very normally, in fact we're heading into a period of time where we're starting the anniversary about a decade from when we first saw the buildup in homes in 2002, '03 and '04, a decade ago so that ought to continue to grow at an increasing rate. new construction has gone from just the lowest levels anyone has ever seen to now on its way to recovery. it's still at a low level but clearly creating new appliance demand and we expect that to be a growth driver for some time, and then the third component is discretionary which is things like remodeling, also impacted by existing home sales because when people move that's a time when they're more apt to want to replace their products. that discretionary area is really the part that's not

coming back very much yet. we think it will, but that's more of our consumer confidence-driven thing. so the good news is everything seems to be going in the right direction. there's no real head winds from this, but you know we're coming off of really low levels and i think we have a long way to go to get back to what we'd consider a norm. >> yeah, well, better some of these risks get out of the way than the alternative at least for now, jeff. always appreciate your time. please come back. >> okay, carl, we will, thank you. >> jeff fettig joining from us whirlpo whirlpool. he was the only representative from observing toke to vote against the fiscal cliff deal, congressman jim lankford joins us next. and michael bay will be with us live in the hour, an action-packed segment. we'll be right back. [ wind howls ]

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the senate is expected to pass the debt limit increase today suspending the limit on federal borrowing through may 18th. rick santelli has some thoughts on that this morning. hey, rick. >> good morning carl and welcome, congressman. >> good morning. >> let's get acquainted a little bit with your voting record just so viewers and listeners can frame where you came from, maybe help decide where fiscal conservatives are going. did you vote for the original bill or where the threshold was a million on the tax cuts before the fiscal cliff deal? >> that never came up. >> that's true you were right. >> that was option b that never came up for a vote. >> it failed, you're right. can i ask you off the record while you're on tv, would you have voted for it? >> i probably would. we're dealing with the dynamic how to protect as many americans as possible from the tax increase. the tax increases don't help our economy so we have to find a way

to protect as many people as possible. >> did you not vote for ultimately the bill that really was voted for and that's the fiscal cliff compromise, you did not vote for that. is that correct? >> that's correct. that's correct. at the end of the day it doesn't help us solve the problem. >> i'm not disagreeing. the bill that's currently being voted on is to suspend the debt ceiling. i've had several e-mails i have to say, congressman, in the last 24 hours, the word suspend makes some people nervous but i think that, i don't see any malicious intent to allow the debt ceiling to get out of control before may, so you think that one is going to pass, correct? >> i think it is going to pass and the suspension was done because the treasury can't tell us right now what will get us past the budget season. our goal was it's not the fact that we have this huge debt which is a gigantic issue. there's no plan to ever get out of debt so we're trying to push back to the senate to say you do a budget, we'll do a budget and as soon as the budget is over for both of us, then we'll deal

with the debt ceiling after that. why are we dealing with the debt ceiling when we don't have a plan to stop overspending. >> it's pretty hard to go through a budget when there is no budget at least on the senate side one that both houses passed. let's get to the meat of what i want to discuss. we talk sequester here, it looks to me like we're asking a program defense that gets about 20% of all the budget to take about half the cuts. now, as wild as that sounds, you need to start somewhere, and it's never going to be an easy process. are you for the sequester as it currently stands, if that's all the spending cuts that you're going to be able to put on the table? >> i would much prefer to find a more reasonable way to do it. doing across the board cuts is the wrong way. if this is the only way question get the president and the senate to agree to reducing spending it's all we've got so at this point the worst thing that can happen we continue to spend out of control and have no plan to bring it down. if this is the only option we have, it's the only option we

have. >> is there a cohesiveness with the republican party, the fiscal conservatives they'll walk this all the way through to the end? do you see any surprises and how do you think the president and the opposing party, the democrats, will respond to the strategy of sequesters? >> a lot of you get a chance to check this stuff all the time. last may in the house we passed a replacement for sequester that was more strategic, that dealt with mandatory spending and discretionary spending, a way to bring it back down to replace the sequester. we passed it again in december, we have waited for the senate to reciprocate and say here is our plan. we put out our plan. we may not like our plan but their responsibility is to answer back and we can go to conference and find a solution on that. at this point we're still waiting on the senate response to come back. we'll put out another plan as the house to say here is where we replace the sequester. if they never respond we have no

way to settle this. >> congressman, thank you and i want to ask you as this progresses towards the may deadline, ask you back. >> we got a march 1, march 27 and may deadline, all coming at us. >> thank you. carl, back to you. >> rick, thanks so much. we're going to close out the month of january here in the states but europe's about to do it in about two minutes. simon will talk about how trade something closing on the continent when we come right back. at fidelity, we do it by merging two tools into one. combining your customized charts with leading-edge analysis tools from recognia so you can quickly spot key trends and possible entry and exit points. we like this idea so much that we've applied for a patent. i'm colin beck of fidelity investments. our integrated technical analysis is one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account. stop! stop! stop! come back here!

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the european markets are closing now. >> the good news is that in germany, unemployment actually fell a touch, but they still may be going into recession, simon. >> the unemployment rate is down to 6% which is a post unification low. the retail sales figures are poor in germany, the contraction is accelerating, germany as a whole, as an economy no doubt contracted overall in the fourth quarter. as you look across the closing area, europe is closing out for the month. there is one market that stands out, it is spain where the loss is there, 2% losses in spain. it's the biggest day so far like so much of economics and there were a lot of companies, deutsche bank was there, diagio, the spirits provider but the

spanish banks have most moved santander increases the amount of cash it's stashing to one side in order to deal with its own losses on the property sector. they now total almost $19 billion for last year, they've sold about 33,000 properties so still there's a huge concern about where we wr the spanish banks as you'll be aware and where that economy is going. tomorrow we get the pmi data which will be crucial in trying to get a first glance on the degree to which we're accelerating down or bouncing back. in general for the stock markets in europe you'll be aware they have risen strongly so this earnings season is the question as to whether or not the numbers will support those gains. if you look at the month so far, you will see that the dow here as we approach 14,000 is massively outperforming now and the dow jones euro stock 50 is beginning to bend down. there's some profit-taking on

that so i ask you the question what would the man who is the head of research for the french giant most worried about? he came here to the exchange, that was the question i put to patrick legland and his answer was he most worries about gold and he's telling people to book profits. he fears that gold could collapse 15% to 20% near-term because of the drastic fall in systemic risk in the system, no inflation risk as far as he is concerned, and because the yield curve will steepen, and therefore you will get bigger returns arguably in the bond market further down the line than in gold which doesn't pay a dividend. patrick legland for what it is worth, he's the head of research for soc gen this may be like dot-com, what may happen with gold could be messy. listen. >> gold is not a liquid asset. if a few investors say okay maybe it's the end of gold soon,

we start taking some profits on one side, and it could become quite bloody and taking into content everybody owns gold and it's used for many assets. >> gold is used as collateral, in other words what he's saying is if the price of gold falls on the collateral that you've posted, either you've got to make that up or more likely a seller of whatevers ayou the you're in. >> soc gen has interesting perspectives. sharon epperson at the nymex. >> reporter: natural gas continuing to lose ground. we'll see if natural gas prices can stay above the $3.20 level, that's the key technical level traders are watching. we saw a brief dip below $3.25 on the bearish data about storage levels. elsewhere in the energy complex, lower oil prices, lower gasoline futures as well but not over the

last two weeks. in fact, gasoline futures have risen by about 10% over that period of time, we've been telling you about hess's reading refinery and that closure and refinery maintenance helping to lift natural gas futures over the last couple of weeks and prices at the pump up ten cents from where we were a week ago $3.42 a gallon is the national average and opus analysts say we could see prices in the next day or two surpass where they were this time of year in 2012 so that's what we'll be watching for in the gas mark. in terms of gold prices as simon was talking about, gold prices definitely are on the decline in this session. we're looking at gold down about 17 bucks or so and whether or not it holds above the $16.50 level is key whether gold can sustain the gains we've seen in 2012-2013. by pisani is at post 10 for a very good reason. >> look at the crowd, pull back a little.

constellation is still halted. it's going to open very shortly. there were at least four trading halts on volatility that i was able to count, then finally a little after 11:00 we had a halt on news pending. this is a halt from the company saying they're going to make a statement. now those who have been following i hope you have been the department of justice is suing to block inbev's purchase of the rest of modelo because they're selling assets to constellation and that's an issue for constellation here. constellation would have had the power to market a lot of big names, for example, corona extra, so they're really very much impacted by this, huge volume, 13 million, 14 million shares already and this normally will do 3 million, 4 million shares. the company issued a statement saying they're disappointed and given today's development we don't expect the deal to close during the first quarter of 2013 but look forward to what they're calling an expeditious resolution to that. as for budweiser, inbev of course but b.u.d. is the symbol,

they'll vigorous ly contest the doj action but it's 8 million shares, many times more than would be normal traded there here so down a little bit overall, we're still waiting here for it to open. indications on constellation, 30 to 33, last trade 31.15. elsewhere the dow has been in a narrow range, about 50 points today. the key point is that the cyclical names, your materials, your energy, your industrials, consumer discretionary are the market leaders to the downside for a second day in a row. however, i don't see heavy volume in the etfs associated with this, don't see signs that a lot of people are getting out and taking a lot of profits. i would note, however, home builders if you look at what the home builders are doing despite good numbers from pulte the numbers are down for a second day in a row and i do see some volume, i do see volume in the etfs associated with home builders that are a little bit above normal so i think people are generally starting to take some profits in the group. big problem there are the

valuations. finally whirlpool great numbers overall and the 2013 guidance just knocked the cover off the ball. 9.25 to 9.75. the general estimates $9.15, $9.17. 31 and a dime, 31.20 are the indications and when you get that close that's an indication the stock is about to open and what you've got is people going back and forth putting in bids and offers here. there you can see the specialists right there. roberts standing right there, and this is an old-fashioned auction, happens this way and people often on the floor are continuing to put in bids but if you watch the specialists -- >> 32 1/2. >> 33. >> that's the governor standing next to the specialist greg, in the quarter. >> 31.20, to 31.30. >> when tfr gets that close when you're within a dime bid and offer that generally indicates

the stock is going to open quickly and they're continuing to yell here, putting bids. >> 31.46. >> 31.46. looks like they'll open in just about -- 31.46. look like we have 31.46 right now. are we going? >> 31.50 level. >> the special cyst asking if everybody's put in their final bid or offer. somebody's putting more. this is actually an auction. i know you think this doesn't happen anymore. here you go. >> 31.75. >> going to 32. >> they just bid higher. >> the order is 32. >> they just bid higher. are we done? >> can i buy more there? >> he just bid higher, now we're at 31.75. >> 32. >> they're going to go to 32. it's a real auction, i know it

sounds crazy but they're actually bidding the stock up at this point. last trade was 31.15 when it was halted. now we're at 31.85 here. >> anybody in, 160 is a buy. >> they can't open until the specialist declares it closed so they're going to consolidate all the orders and open on a single price. >> hey, bob? >> all right, 31.85. 31.80, now at 31.80. >> 31.80. >> 85 top. >> 31.80. >> just bid at 31.80. >> 85 top buyer. >> same story, same story, 85 you're buying 25 thou. >> 85 is going. >> it's going. there you go.

i have to wait until he waves his hand. 31.85 it looks like. >> it opened. >> we got it. >> here on cnbc. >> we got it greg, 31.85? >> it opened, you bought 50. >> we opened at $31.85, a little bit of drama there but it really is an auction, guys back to you. >> off the low that last trade before it halted before it being halted 31.08 and now at 31.50. 52-week low on constellation is $18.50, had a huge run-up -- >> did i get that rate? >> opened at $31.85. >> thank you. >> thank you for that bob, level of commotion we don't often see at this hour on the floor. meantime faber is back on set with more details about what this all means. >> important to remind people why constellation is down so sharply as they try to figure out exactly what price should be paid for that stock. you go back to june 29th and the deal anheuser-busch had to deal

with grupo modelo to sell 50% of crown, which was a 50/50 joint venture with grupo modelo and cost la constellation to constellation. crown is the owner, the marketer t sets prices in the u.s. as well, and they thought at the time hey, we're selling this, constellation is going to tone completely, they're paying $1.85 million, about 8.5 times crowns ebit for that deal and they claim a wide distribution as well to ensure the continuity of supply, quality of products, introduce innovations that would have given crown complete independent control and distribution marketing and pricing for all moddelo brands n the u.s. that's why you would not get an anti-trust enforcement, we're not setting prices for corona

here for example in the u.s. constellation is. it was a very positive deal for constellation. now of course that deal is in question, hence constellation shares are declining rapidly. we'll see if this ends up in court. we'll see what occurs as a result of that. people are running through the complaint, not just the press release, they do seem to have a few e-mails internally, does the doj, certainly don't appear to be positive or at least argue for why they might want to actually move to try to block the deal in terms of consolidation in the beer market. we'll see if this ends up in court or not. not clear whether there were some negotiations going on that something anheuser-busch could have done to have forestalled the doj but as i told our viewers earlier of course this was a surprise to those close to the deal, not as much a price to modelo shareholders. there was a spread in the stock to the deal price $9.15 u.s., announced back on june 29th. >> is constellation here

collateral damage? was justice's real complaint having bud have all of modelo or was it constellation having power with corona? or both? >> no, it was bud having complete control or owning all of those brewed beers in mexico. >> so constellation is caught in a cross-fire of sorts. >> they are but they got a great deal as a result of concern about anti-trust to begin with, hence the purchase of that 50% ownership of crown that they didn't already own, and the distribution deal, but yes, part there now a victim of what was a very beneficial set of circumstances for crown or i should say excuse me constellation when this deal was announced in june. mexico approved it, europe's approved it. this is i think the first big move by the new head of enforcement over at the doj. >> well, drinking beer on super bowl sunday is going to be a whole lot different. >> people will think about all their brands. >> exactly. >> i didn't realize corona is

the top selling import, a huge brand. >> a huge deal. bud tried to compete with it and failed with a lime some sort of a lime drink in a clear bottle. interesting reading the press release. it's not written in legalese so if you care about the beer market at all you may enjoy reading it because those are their arguments simply, carl, too much consolidation, hence too much pricing power in the hands of very, very few competitors. >> stick around, david, evans benz from the "st. louis post-dispatch" good to have you, welcome. >> hi, thanks. >> how is this playing in missouri? >> it's big news and we just got a statement from anheuser-busch saying they will fight the lawsuit vigorously so they're obviously not happy about it. >> is there a plan b here for busch other than going straight to court? >> i don't know. it seems like the doj is definitely going to try to block this in court so it seems like

that is the route the parties have to take to solve this, and if so, there would be a pretty long battle i think. >> obviously it's come as a surprise to investors. i'm sure you've been watching or hearing about what the stock's done over the past hour or so, but can you put into context the degree this was a priority for bud, how long they've been working on it, how much was riding on this actually going through regulators? >> well, they've been working on it now for several years, and i think ever since inbev came and bought out anheuser-busch in 2008 sort of the name of the game for them has been mergers, consolidation, alignment. this is kind of right on path with their plan so i think this is the big road bump for them. >> obviously it's to a large degree we're talking about u.s. regulators regulating a u.s. market but it does have to do with opportunities around the world, right, opportunities in latin america. >> sure, which is a huge

battleground right now for big breweries and no one's bigger down there than grupo so having that in a.b.'s portfolio would be a huge cous. >> culturally has inbev changed a lot? >> i think some of the corporate culture has changed. it's a slimmer company now. the headquarters de facto headquarters are no longer in st. louis, so again there's been a lot of cultural climate changes. >> has to make you wonder what august busch must be thinking at this stage. we were talking about management structures that go back a ways, but you wrote the book "brew in the lou." i wonder what this chapter feels to you like right now, given the fact that a lot was riding on this deal, a lot is riding on this deal. >> yeah, i mean the post-2008 inbev takeover has been a whole chapter of the st. louis beer world with the explosion of kraft breweries that are popping

up, but last year with the buyout of goose island in chicago, that was kind of a big coup for a.b. to gain into the craft market and this taking over grupo would have given them a huge amount of stock and as you were saying the latin-american market and the corona imports which is, the u.s.'s biggest imported beer so it would have been big for them and it will be interesting to see how this plays out. >> i assume this is a page one story for you for tomorrow morning? >> for sure, yes. >> evan, thank you for your time. i appreciate it. i know a busy day for you, evan benn with the "st. louis post dispatch." a lot more "squawk on the street," back in a minute. ♪

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san francisco is being taken over by apploonians. macworld 2013 is being called the ultimate ifan event. it will show case latest products. ashton kutcher will play jobs in the biopic. we joined fans on the site. >> obviously i'm got running the company i'm sure they're concerned about their stock price. as a user it doesn't concern me.

i think they'll continue to release good products. >> i'm not worried about their product line, people like to say since steve jobs is gone it's all gone in the toilet, that's a bunch of crap. excuse me, am i allowed to say crap? sorry. >> i'm excited about what's coming out and it's exciting to see what other companies are coming out with. >> a lot of the devices are pulling people away. i don't find myself really wanting that but the galaxy s3 is kind of sexy, i hate to admit that but it is kind of pretty. >> apple fans may be ecstatic. the stock has seen better days, the worst month since 2008, down 14%, as you can see, down $1.50 today, $4.55. if you hate football you'll probably turn the volume up for the commercials during the super bowl. not all of them will star celebrities and cost millions to make. our julia boorstin is live in l.a. with film director michael bay to talk about how he's involved with the ads this weekend.

julia, good morning. >> reporter: thanks so much, carl. we're happy to have michael bay. thanks for joining us. >> thank you. >> you're none for your blockbuster movies but involved in fdoritos crash the super bow competition. what are you doing with doritos? >> it's a great way for a young person to put their little commercial out on the super bowl played in front of 110 million people. this is a way i'm giving back, i'm helping sponsor this contest doritos has. >> you're taking one of the filmmakers and bringing them on to "transformers"? >> it won't be one of the most glamorous jobs because there is no glamorous job in hollywood. >> that's what they say. is this a way to discover new film making talent? >> the for ree toe ads the last five or six years i found out they're not done by professionals. >> you are a successful

filmmaker, we're a business network. what is the secret to your business success, how do you pick and conceive of your films to ensure they have success at the box office? >> well, you got to have a gut, you've got to break through the clutter. you've got to give audiences something different and that's what separates you. >> so how did you know that "transformers" which was kind of a tired, old kids' toy brand would be a hit at the box office? >> i thought it was a tired movie. i thought it would be a bad idea and spielberg called me up and said would you like to do it? i'm like ugh, i don't know but i figured if i could make it very real and accessible to a worldwide audience we'd have something here. >> you're about to make the fourth one. is it a challenge to keep a brand fresh? >> it is but we brought in mark wahlberg to star and i keep challenging myself to do something new and different. >> now the studios are making fewer big movies overall now. they're consolidating the number of movies. how does that change your job as

director and producer? >> it's not changing my job because i do the big movies. it's tough for a lot of people in the business because they are consolidating. it's probably right they're consolidating because there's too many movies out there. but then again, the worldwide audience is opening up so the foreign box office is just gigantic. >> carl, you want to jump in? >> i would love to. michael, you make movies that play better when they're seen big. who wouldn't want to see transformers on a huge screen versus at home. you've been relatively vocal saying don't put films on demand during their theatrical run. as we watch how distribution changes i wonder if your view is evolving, too. >> no, it's not, because we make movies for a shared audience, and that experience is what we do it for, and i think the window could be tighter, but i don't really agree with releasing it all in